A publisher is deciding whether or not to invest in a new printer. The printer would cost $900, and would increase the cash flows in yea 1 by $500 and in year 3 by $800. Cash flows do not change in year 2. If the interest rate is 12%, what is the present value of the cash flows from the investment? a. $155.59 O b. $1015.85 c. $1076.56 O d. $346.78
A publisher is deciding whether or not to invest in a new printer. The printer would cost $900, and would increase the cash flows in yea 1 by $500 and in year 3 by $800. Cash flows do not change in year 2. If the interest rate is 12%, what is the present value of the cash flows from the investment? a. $155.59 O b. $1015.85 c. $1076.56 O d. $346.78
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:A publisher is deciding whether or not to invest in a new printer. The printer would cost $900, and would increase the cash flows in year
1 by $500 and in year 3 by $800. Cash flows do not change in year 2. If the interest rate is 12%, what is the present value of the cash
flows from the investment?
Ⓒa. $155.59
O b. $1015.85
Oc$1076.56
d. $346.78.
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